The Nominal Rate of Return Minus the Inflation Rate Is

question 100

Multiple Choice

The nominal rate of return minus the inflation rate is called the

• A)stated rate of return.
• B)standard rate of return.
• C)real rate of return.
• D)Fisher effect.
• E)none of the above.

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Definitions:

WACC

Stands for Weighted Average Cost of Capital, a calculation used to assess the cost of a company’s financing by averaging the cost of its equity and debt, weighted by their proportion in the company’s capital structure.

WACC

Weighted Average Cost of Capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is proportionately weighted.

NPV

Net Present Value is a financial metric that calculates the present value of an investment's expected cash flows minus the initial investment.

IRR

Internal Rate of Return; the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.